Private Landlords and Letting and Managing Agents (Regulation) Bill

Mary Macleod Excerpts

Friday 25th October 2013 Commons Chamber

[Philip Davies]

I am pleased that we agree on the main thrust—that the vast majority in the sector are good people trying to do the right thing, with no intention of being bad to their tenants. That is where I am coming from, and I am delighted that it is where the hon. Gentleman is coming from as well. We differ on the best way to help those people do what they are doing. I do not think that piling on extra regulation and cost is the way. He does. That is our genuine disagreement.

The consequences of such regulation would be terrible for some of those landlords. The good people, to whom the hon. Gentleman referred, might well have to sell their properties because they cannot afford the extra costs and regulation—perhaps to one of the unscrupulous landlords whom he is trying to stamp out. That would be another terrible unintended consequence of what he is trying to do. The good people are probably, by definition, not making as big a return as those who are not so good. Such a transfer of property would not be to the hon. Gentleman’s or the tenant’s advantage.

In February this year, the Office of Fair Trading concluded that the demand for rental properties was increasing. In 2010-11, the lettings market accounted for 16.5% of all housing in England, which equates to 3.6 million households. As my hon. Friend the Member for Bury North mentioned, that represents an increase from 2 million in 1999.

Government figures suggest that the number of households in England will grow by an average of 232,000 a year until 2033. There is also a general trend of increasing rental in Scotland, Wales and Northern Ireland. Meanwhile, mortgage lending has decreased following the financial crisis, so demand for properties to let may be outstripping supply. That is why it is essential that we do nothing that could lead to a reduction in the supply of private rented accommodation—all that will do is stop people having their own homes to live in.

The results of a National Landlords Association tenants survey of September last year showed that just under 37% of respondents stated that they intended to remain in private rented housing as their long-term housing solution; it seems that they are perfectly happy with their situations. Some 42% responded that they had lived in their current private rented property for more than four years, compared with only 20% who said that they had lived there for less than one year. Again, that is evidence that people are satisfied.

[Mary Macleod (Brentford and Isleworth) (Con)]

Does my hon. Friend agree that, at a time when many are struggling to get on the housing ladder, it is important that we encourage as many private rental landlords as possible to rent out properties, so that there is more choice? Availability is limited, especially in cities such as London.

[Philip Davies]

My hon. Friend is absolutely right. She knows a great deal more than me about the problems facing people in her constituency and the rest of London. As ever, she is a great champion of their needs. She clearly recognises that the last thing we want to do is choke off the private rented sector, which is what the Bill would do.

Last year, the Department for Communities and Local Government published a guide for local authorities called “Dealing with Rogue Landlords”. It illustrated many of the remedies already available to deal with what the hon. Member for Mansfield accepted was the small number of problem landlords. The document set out a wide range of powers to tackle the problems associated with criminal landlords. Those powers were enhanced by the Localism Act 2011.

There is other relevant legislation. The Housing Act 2004 allows for a housing health and safety rating system, an evidence-based system used to assess housing conditions in all residential property. That set a minimum standard for all residential properties, ensuring that they are safe and habitable. It comprises an assessment of the presence and severity of 29 hazards, including excess cold.

As a result of the 2004 Act, local authorities have a duty to take enforcement action to secure necessary improvements where those serious hazards are present. They also have the discretionary power to intervene where less serious category 2 hazards are present. To determine the most appropriate form of action, local authorities can consider the extent of the vulnerability of the persons in the accommodation.

The local authority can carry out an assessment of the home and look at the likelihood of an incident arising from the condition of the property and what the harmful outcomes may be. That seems an incredibly useful tool for what the hon. Gentleman refers to as “dealing with rogue landlords.” There is mandatory licensing of houses in multiple occupation. There is already a statutory duty on local authorities to license larger, higher-risk houses in multiple occupation of three or more storeys housing five or more unrelated persons.

Private landlords must be deemed fit and proper persons if they are to be granted a licence by the local authority. Breach of a licence condition is already an offence, subject to a fine of up to £5,000. Letting or managing a property without a licence is a criminal offence subject to a maximum fine of £20,000. There is also the additional licensing of houses in multiple occupation. Poor conditions and bad management practices can be dealt with by local authorities, which can introduce schemes subject to local consultation. There is also selective licensing—a discretionary power to license all privately rented properties in a designated area deemed to suffer from low housing demand and/or significant and persistent antisocial behaviour.

Furthermore, local authorities are required to provide a robust evidence base for introducing a scheme, and once they have introduced it they have substantial powers. There are special interim management orders to take over the management of individual privately rented properties that give rise to significant problems if landlords do not take action themselves. Local authorities can require approval from a residential property tribunal to do that, but the power is there if there are terrible landlords. There are planning contravention notices for when there may have been a breach of planning control. There are temporary stop notices, enforcement notices, stop notices, breach of conditions notices and injunctions that can be obtained from the High Court to restrain any breach. There are also powers of entry and article 4 directions. The Proceeds of Crime Act 2002 can be utilised if landlords have been using proceeds of crime in relation to local housing, and it allows specific financial investigation powers for the public sector. Lots of assets have been recovered from people using that tool.

We already have lots of legislation and regulation on the statute book that can help to deal with what the hon. Gentleman would call rogue landlords and the kinds of activities they undertake. In fact, the Department should be commended for its document, which gave people a very clear guide as to exactly what powers local authorities have. Perhaps local authorities have been unaware of what powers they have to deal with rogue landlords in the private sector. A better starting point than more legislation might be to ensure that local authorities are using the powers they already have in existing legislation to deal with the issues that he is trying to deal with.

On the register and the registrar, I do not know whether the hon. Gentleman has any idea of how much registration would cost and how much the registrar who is administering all this would be paid. Would it be a full-time or part-time role? How would the person be selected for the post? Would the role be advertised to the general public? Would it be a Government appointment? Would the landlords themselves, who were paying into this scheme, be able to appoint the person they wanted to run it? It cannot be a political post; it would need to be independent. How long would the role last for? All sorts of questions about the nitty-gritty of some of the things in the Bill need to be considered.

--- Later in debate ---

[Mary Macleod (Brentford and Isleworth) (Con)]

It is an immense pleasure to see you in the Chair, Madam Deputy Speaker. I know that you will do the Chair and the House proud with fairness, dignity and grace.

It is a great pleasure to follow my hon. Friend the Member for Bury North (Mr Nuttall), who made some important points about the Bill. The private rental market is a vital asset to this country, especially London. For a Member who represents a London constituency, it is important to discuss and debate it. For millions who cannot afford to buy, who are saving for a deposit or who just want some flexibility, the private rental market is critical.

I have been a landlord in the past, and I have also been a tenant, as I am sure many Members have. As you probably know, Madam Deputy Speaker, I was born across the river in St Thomas’s hospital in London and spent my first years in Battersea, but then had all my education in Scotland. The first place I rented was at Glasgow university. After graduating I came straight back to London, where I feel I belong, and I have rented properties in Shepherd’s Bush, Acton, Westminster and Chiswick. I have been a tenant nine times, and I hope I have been a good tenant. I cannot remember any disorderly behaviour on my part, so I hope I have been seen as a good tenant and a good landlord.

In the London borough of Hounslow, 42% of households rent in the social and private sectors, which is 10% higher than the national average. We want to build more housing in London and encourage more private landowners to rent out property. What worries me about the Bill is that it might prevent people from doing so.

It is interesting to see how important issues in the private rented sector are to people. In my constituency there are 93,844 residents in 48,500 households. I have received a total of 14,742 cases on housing, but only 35 of those have involved private landlords. Social housing has made up a lot more of them—nearer 500 cases. That shows that for my residents, the important issues are to do not with private landlords but with social housing, whether waiting lists, the state of houses, the state of temporary or sheltered accommodation, repairs or housing associations.

I believe that the hon. Member for Mansfield (Sir Alan Meale) has good intentions to drive up standards. That is what we want, but I do not believe that the Bill is the right way to go about it. There are good landlords. When he talked about the percentage of tenants who are unsatisfied, I wondered how many of our constituents would be satisfied with us if we did a survey.

[Margot James (Stourbridge) (Con)]

My hon. Friend is talking about the effect of rogue landlords on tenants. Does she agree with my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) that the further regulation suggested in the Bill would be far more likely to trap decent, smaller landlords who are trying to do a good job by tenants, and that rogue landlords who are responsible for the problems that she is talking about would probably evade it? The Bill would therefore be ineffective where it really counts.

[Mary Macleod]

My hon. Friend makes an excellent point, and she is right to say that we want to encourage more private sector landlords. We need more landlords, and I do not want them to be put off by additional costs, regulation and red tape. In any case, as my hon. Friend said, rogue landlords would no doubt find their way around that anyway. I do not want to impose cost, red tape and more regulation. The Conservative party is about rolling back the state and having less regulation, and some of the extra charges would lead to landlords having to impose higher rents at a time when the cost of living is critical and we want more housing.

We have heard from many hon. Members and the Minister about the work that the Government have done. As the hon. Member for Corby (Andy Sawford) said, substantial legislation is already in place, and we certainly do not need or want any more. We heard about the Communities and Local Government Committee, and my hon. Friend the Member for Shipley (Philip Davies) said that we should simplify legislation. That is the right thing to do. My hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) mentioned making the provisions consumer-led, and as someone who came from the business world prior to entering this place, I firmly believe in that. We do not want to live in a nanny state; we want to create a competitive market and—as my hon. Friend put to the House so well—people are intelligent enough to make those comparisons.

If we consider the recommendations in the Bill, even the national register of private landlords can and will be a financial burden on landlords—a cost that would no doubt be passed on to tenants, which we do not want. Regulation of private sector letting agents and managing agents is again about imposing more and more burdens on local authorities, increasing costs and reducing the choice and availability of accommodation offered to tenants. I certainly would not want that across London and the rest of the country.

The Minister mentioned the things that the Government have done, which are important. They recently announced a tenants package, which means that we do not need to introduce new regulation for that. The package includes the tenants charter, which will help to promote awareness among tenants about what to expect, such as transparency of letting agents fees. We heard about the Government-endorsed model tenancy agreement that written tenancy agreements can be based on.

I had hoped that the hon. Member for Mansfield would mention another issue that has been brought to my attention in my constituency many times. Landlords have had to take tenants to court to evict them because of advice that the tenants received from local councils. If tenants want to be seen as homeless and get housing support—even though under their tenancy agreement they know they should leave the property with a month’s notice, or whatever—they have been told to overstay so that they have to be taken to court and evicted. Then they will not be seen as having made themselves intentionally homeless. I had hoped that the issue would be addressed by the Bill, but it was not.

I will conclude my remarks because I want to give my hon. Friend the Member for Stourbridge (Margot James) the last few moments to say a few words. My hon. Friend the Member for North East Somerset said that we should be making life better, easier and happier for citizens of this country, and that in North East Somerset they would do that over a pint of cider. In Brentford and Isleworth it would be over a cup of Teapigs tea, which is made in Brentford, or a pint of London Pride or Chiswick Bitter. I hope that we in this House can do everything possible to make life better, easier and happier for our constituents. I therefore cannot support the Bill.